Closing the ledger 10/08/98

By The Times-Union,

Thursday, October 8, 1998Story last updated at 9:52 a.m. on Thursday, October 8, 1998

David Ginzl, who is in charge of all the Barnett Bank history articles, poses with old superteller signs, the first bank leger from May 1877, a painting of founder William Boyd Barnett, an old coin machine, and photos of ad campaigns.-- Don Burk/StaffClosing the ledger

Official name change makes Barnett history

By Simon Barker-Benfield

Times-Union business writer

The big slab of a book, bound in leather so old that it is starting to crumble, must weigh 40 pounds if it weighs an ounce.

The story it starts to tell began on May 7, 1877, in the post-Civil War Freedmen's Bank Building on Forsyth and Main in Jacksonville.

Today, it sits closed on a steel storage rack in the back of a suite of empty executive offices in the old Barnett Bank headquarters office at West Adams and Laura.

It has taken 121 years to move just two blocks, and the story is now over.

The first page, first entry in the Bank of Jacksonville(later to be named Barnett) in May 1877. -- Don Burk/Staff

The book is Barnett's first ledger.

For hard-core former Barnett Bankers, the ones who brag that when they bleed, they bleed green - the old corporate color - the book is ground zero in the bank's history.

On Page 1 is 19-year-old Bion Barnett's handwriting recording the bank's first loan: $500 to a C.W. Blew.

William B. Barnett had started the bank with his son, Bion, and J.W. Swaim, a clerk.

The statue of William Boyd Barnett, which now is in the lobby of the Barnett Center.-- Don Burk/Staff

Today, 121 years, six months and one day later, the Barnett name starts coming down for good from branches across the state, replaced by the red-white-and-blue of NationsBank, which bought Barnett earlier this year.

Barnett was the oldest bank in the state.

''They [Barnett Bank] were the last major survivor,'' said Alan Lastinger, Barnett's last chief operating officer and the man behind the effort to preserve Barnett's history.

This is a bittersweet time for many.

''I sure hate to lose them,'' said William R. Frazier, a longtime Jacksonville attorney, who has had a checking account with Barnett since 1938, when he was a teenager.

A Barnett account was automatic in his family, he said.

''I loved Barnett,'' said John Cannon, who went straight from Stetson College to work at Barnett in 1950 and stayed for 40 years, heading up Barnett Banks across Florida.

Barnett's first drive-by teller, in 1957, was called Jack in the Box.-- SpecialIt had personality in an age when banks are becoming more and more antiseptic, said Nancy Bush, an industry analyst who tracks banks across the country for the firm of Ryan, Beck & Co. in Livingston, N.J.

The storage room that houses the old ledger looks like somebody's attic, but a real tidy one. A banker's attic.

The files make it possible to reconstruct a large slice of Jacksonville's and Florida's history.

In its first 50 years, Barnett survived two killer epidemics of yellow fever, the great freeze of 1895 and the great fire of 1901, when most of the town burned.

The bank was the only bank not destroyed by the fire. In the aftermath, competing banks used the Barnett vault to store their cash, said David Ginzl, a former senior Barnett executive. He is a historian by training and is writing a history of the company.

Barnett survived the financial panics of 1893, 1907 and 1929. This was back in the days when there was no federal insurance to insulate customers from bankers who did not know how to run a bank, he said.

''It has never failed at any time to take care of the legitimate requirements of its customers, nor at any time failed to pay cash on demand to any and every depositor,'' said Bion Barnett in 1927, celebrating the bank's 50th anniversary.

He was 70 years old by then but still had another 31 years to go. In his 80s he shot his age in a round of golf, which to golfers is a major achievement.

At 90, he said: ''I have decided to establish a rule of the bank to the effect that no officer or employee who reaches the age of 89 need return to work after the noon lunch hour.''

He showed up for work until he was 93. He died in 1958 at the age of 101.

As one of the biggest and strongest banks in Florida in the 1930s, Bion Barnett's bank helped keep the state's banking system operating after other banks started failing during the Depression. Communities suddenly without banks came to Barnett asking for help.

''They went to the Barnett people in Jacksonville and said, 'We need a bank,' '' said Cannon.

Barnett was asked to start banks in Cocoa, Deland and Avon Park after the banks there failed.

All but one of St. Augustine's banks failed. Barnett came in and propped up the lone survivor, St. Augustine National Bank, by investing in it.

But Barnett was basically a downtown Jacksonville bank. Its second office was not opened until 1955, in the Murray Hill neighborhood.

Barnett did not start really evolving into a statewide institution until the 1960s and 1970s, under Guy Botts, and later under his protege, Charles Rice, Barnett's last chairman and CEO.

Botts and Rice bought banks across a Florida that was booming, using stock in Barnett, now a public company, to pay for them.

The 1960s ended with 11 new Barnett Banks, the 1970s with nearly 50 more, and Barnett was on its way to being the leading bank in the state.

''You can buy things, but then it is a question of how well you can run them,'' said Frederick H. Schultz, former vice chairman of the Board of Governors of the Federal Reserve System. Schultz first went on Barnett's board of directors in 1961, following his father onto the board.

Schultz said one of the things that set Barnett apart was its ability as a company to fully engage the hearts and minds of its employees.

''There was a strong and important emphasis on developing a corporate culture so that employees wanted to be a part of Barnett,'' said Schultz.

By 1997 Barnett claimed it was serving four of every 10 households in Florida.

But unsure that Barnett would be able to sustain its string of record profits in the years ahead and figuring that prices for banks where as high as they were likely to get, the company leadership that summer put Barnett up for auction. NationsBank bid the most, $14 billion in its own stock.

NationsBank, headquartered in Charlotte, N.C., had started expanding in the 1970s by buying smaller banks, just like Barnett.

''There is a twinge of regret as the big green signs go down,'' said Roland Kennedy, who went to work for Barnett rolling coins in the vault in 1946 right out of high school and stayed 47 years.

Every quarter Kennedy and other Barnett veterans meet at the Piccadilly cafeteria near Regency Square mall to stay in touch and talk about old times.

''If Barnett can disappear, then nothing is forever. We might as well accept that change is inevitable in virtually everything,'' he said.

But if Kennedy sounds pragmatic, Frazier does not.

''I despise it all,'' said Frazier, who added that he wished Jacksonville rather than Charlotte had produced both Ed Crutchfield and Hugh McColl, respectively chief executives of First Union Corp. and BankAmericorp, the new name for NationsBank.

Frazier plans to close his account tomorrow and move it to First Guaranty Bank and Trust, which is now Jacksonville's oldest independent bank.

Not so Terry Hawkins, who owns Hawkins Regal Flooring in Mandarin. He is precisely the kind of customer that makes bankers quiver. He owns his own business and keeps both his personal and his business accounts at the branch.

''They are fantastic over there,'' he said.

Kennedy said he didn't really care if the bank changes somewhat, as long as the staff did not.